The latest trading update from Foxtons has revealed that sales revenue in the first quarter of this year was down 9% compared to Q1 2021, which benefited from higher transaction volumes ahead of the original stamp duty relief deadline of March 31 2021.
According to the agency’s note to the London Stock Exchange this morning, sales revenue was £9.6 million in the three months to March 31 2022, down from £10.6 million in Q1 2021.
It said buyer demand was strong throughout the quarter, and ‘in a positive trading environment we delivered market share growth’.
Foxtons also claimed it was entering Q2 2022 with an under offer pipeline up 8% year-on-year, but admitted that Q2 2021 will be a tough comparator with volumes boosted by the extension of the stamp duty holiday, which it says resulted in a significant number of sales transactions being pulled into the second quarter.
“In line with our growth strategy, we are increasing the number of sales negotiators in our branches to maximise the available revenue and profit opportunity,” it added.
Elsewhere, its mortgage broking revenue was up 5% to £2.4 million from £2.3 million in Q1 2021, with ‘good growth’ in repeat remortgage business offsetting lower new purchase mortgage volumes. In the last quarter, the agency said it initiated its mortgage broking growth plan by building its financial adviser base.
Lettings continues to be the main driver of growth for the agency, with revenues up by 21% (£3.1 million) on Q1 2021. The success of the lettings and mortgage broking divisions means that, overall, the agency has seen total revenue in the first quarter of this year boosted by 8% to £30 million.
It said all areas of the business were trading in line ‘with management expectations’.
Nic Budden, Foxtons’ chief executive officer, said: “I am pleased to report we have had a good start to the year, with all areas of the business trading in line with our expectations. The lettings business has performed strongly, growing both organically and through the contribution from the D&G acquisition. Our sales business has continued to deliver market share growth and entered the second quarter with a healthy under offer pipeline. We continue to take cost action and have made good progress with our pipeline of potential lettings portfolio acquisitions.”